Data from the Bank of Portugal predicts a reduction in the demand for home loans by private individuals in the near future.
Source: Pexels
Author: Redaction
The last quarter of the year saw a
decrease in demand for home loans, a phenomenon that is justified by lower consumer confidence and, for the coming months, a
"particularly sharp reduction is expected in the housing segment", according to data from the
Banco de Portugal's Bank Lending Survey.
In
addition to the housing sector, banks are also reporting reductions in
consumer credit and other lending, which covers not only individuals but
also, slightly, Small and Medium-sized Enterprises (SME), for long-term
loans. This trend, however, was not seen in companies, which increased
the demand for short-term home loans due to
"increased financing needs for inventories and working capital, as well as refinancing or debt negotiation in the case of SMEs".
For
banks, the concessions of housing loans to individuals and SMEs have
been gradually tightened, due to the current fluctuating economic
situation, and the credit conditions have also suffered a slight
increase in spread.
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